Social Security and Medicare Lock-Box Act

The Social Security and Medicare Lock-Box Act would create dedicated, separate accounts to permanently segregate the “surpluses” of the Social Security and Medicare Part A trust funds and would suspend current investment of those surpluses until Congress authorizes alternative investments beyond U.S. government obligations. Specifically, it would establish a Social Security Surplus Protection Account inside the Old-Age and Survivors Insurance (OASI) Trust Fund and a Medicare Surplus Protection Account inside the Federal Hospital Insurance (HI) Trust Fund. Each year after 2025, the Managing Trustee would transfer from the respective trust fund an amount equal to the annual surplus, calculated using statutory tax and outlay formulas. The funds placed in these accounts would not be available for investment by the Managing Trustee. The bill also creates a Social Security and Medicare Part A Investment Commission to study and recommend non-Treasury investment options for the trust funds, with a formal report due by October 1, 2025. If a later law authorizes non-Treasury investments, the interim “lock-box” protections would no longer apply starting with the first fiscal year after that law takes effect. Sponsor: Rep. Walberg (introduced in the House); Status: Introduced.